Page 32 - MetalForming January 2010

Michael Bleau has served manufacturing and consumer- related industries since 1986. Prior to forming Industry Scope, a strategic b2b and b2c sales and marketing consultancy, in 2002, he held executive positions for several automation and press manufacturers. Michael regularly consults with manufacturing companies on strategic planning, sales and marketing, brand and product development, PR and sales-channel development. Industry Scope
tel. 810/397-1429
mbleau@industry-scope.com www.industry-scope.com
Having made it through the fray, now may be the best time to rede- fine your stamping offerings or overhaul your entire approach to the business. Historically, post recession- ary economies represent some of the best times to start new business ven- tures. Encouraging entrepreneurial thinking within your workforce can be a catalyst to new opportunities. Taking a fresh perspective by questioning everything you do, why you do it and how it came to be may create some uncomfortable conversations with individuals who tend to be averse to change, but the payoff exceeds a few bruised egos.
To really dig deep takes an unwaver- ing commitment by management. Your company also may benefit from an out- side perspective that isn’t restricted by political or emotional equity—someone who isn’t concerned with tipping the sacred cows. Recognizing and embrac- ing alternative strategies can be a chal- lenge that may simply escape longtime executives and employees who may have had little opportunity for exposure to other approaches—you don’t know what you don’t know.
A recent conversation with a retired stamping executive highlight- ed the importance of making the hard choices, challenging the status quo and reaping the rewards of changing the rules governing the way we do business.
Frank Maday has a long history in stamping, having served his tool and die apprenticeship at Chrysler, then becom- ing a tool and die manager at VW, tool- ing and QC manager at Budd, tooling manager for Ford Walton Hills and
then, where our story begins, as VP of engineering at Mayflower Vehicle Sys- tems’ U.S. operations. The few years leading up to 2000 were taxing on Mayflower’s European operations, specifically its vast operation in Gagge- nau, Germany. In early 2000, Maday was named managing director for the division, where he immediately began dissecting the multiple-plant campus’ $65-million business to better under- stand how it was losing nearly $8-mil- lion annually.
As a Tier One automotive supplier, Mayflower produced stampings and finished assemblies for European automakers, including catalytic con- verters and exhaust systems. To under- stand the cost structure, Maday imple- mented detailed value mapping exercises to break down material, labor and general overhead costs on a per-job basis. This quickly uncovered a number of jobs that were generating losses with each part shipped. After assembling the details, Maday led efforts to approach customers in an attempt to justify piece- price increases. In those cases where the customer refused, Mayflower tact- fully gave back the nonprofitable work. This helped, but it did not solve the basic problem of having too little opportunity and too many competi- tors driving prices down.
In a game-changing move, Maday shifted Mayflower’s basic focus of being a Tier One supplier to becoming a Tier Two supplier. This had the immediate effect of growing its customer base from around six to more than 30—effective- ly converting competitors into prospec- tive customers. Further, it placed Mayflower at the top of the Tier Two
30 METALFORMING / JANUARY 2010
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THE BUSINESS OF METALFORMING MICHAEL BLEAU
Entrepreneurial Economy: Change the Rules